China Eximbank provides $451.1 million buyer’s credit loan for Bata Port Rehabilitation and Expansion Project (Linked to Record ID#484)

Project narrative

On November 16, 2006, China Eximbank and the Government of Equatorial Guinea signed a $2 billion buyer’s credit facility agreement (互惠贷款) for various infrastructure projects. All subsidiary loans approved under this buyer’s credit facility agreement carry the following terms: a 5.5% interest rate, a 5 year maturity, a 2 year grace period, a 0.375% commitment fee, and a 0.5% risk guarantee (garantia del riesgo) cost. The subsidiary buyer's credit loans under the $2 billion facility were secured with (i.e. collateralized against) minimum cash balances in an escrow account opened by Government of Equatorial Guinea in China Eximbank. Under the original terms of an Account Settlement and Financing Agreement (Convenio de Liquidacion de cuentas y Financiamiento) that the parties signed on February 17, 2006, the minimum cash balance requirement was reportedly equivalent to 30 percent of the Government of Equatorial Guinea's outstanding stock of debt to China Eximbank. After the Account Settlement and Financing Agreement was amended on March 26, 2010, the borrower was expected -- at any given point in time -- to maintain a minimum cash balance in the escrow account (also known as 赤道几内亚共和国财务预算部) equivalent to the value of its next set of semi-annual principal, interest, and fee payment obligations to the lender. The borrower was also expected to deposit the cash proceeds from its oil export sales (crude oil sales revenue) to China into a payment reserve account (also known as 还款准备金 or 赤道几内亚共和国财务预算部还款准备金). More specifically, the borrower was expected to deposit the cash proceeds from six oil cargoes into the payment reserve account. Then, in 2007, China Eximbank and the Government of Equatorial Guinea signed a $451,141,152.60 subsidiary buyer’s credit loan agreement for the Bata Port Rehabilitation and Expansion Project. The proceeds of the loan were used by the borrower to finance an EUR 315 million commercial (EPC) contract with CCCC First Harbor Engineering Co. Ltd, which was signed on April 2, 2007. The loan had disbursed $194,563,905.00 as pf 2009, $194,563,905.00 as of 2010, $404,805,468.33 (EUR 303,960,329.31) as of 2011, $404,805,468.33 as of 2012, $451,141,153 as of 2013, $451,141,153 as of 2014, $451,141,153 as of 2015, $451,141,153 as of 2016, $451,141,153 as of 2017, $451,141,153 as of 2018, and $451,141,153 as of 2019. Its principal amount outstanding was $194,563,905.00 in 2009, $194,563,905.00 in 2010, $404,805,468.33 (EUR 303,960,329.31) in 2011, $345,427,861.70 in 2012, $218,551,986.69 in 2013, $150,471,440.68 in 2014, $86,327,129.92 in 2015, $32,919,449.54 in 2016, and $5,791,963.18 in 2017, $0 in 2018, and $0 in 2019. Then, in 2011, China Eximbank and the Government of Equatorial Guinea signed another subsidiary loan agreement -- worth EUR 291,661,380.33 -- for an increase in the scope of work under the Bata Port Rehabilitation and Expansion Project. However, the loan agreement was subsequently cancelled. The project involved the reconstruction of an existing general cargo wharf at Bata Port that was 570.5 meters long and 163.65 meters wide and had 5 berths. The wharf is capable of simultaneously accommodating two ships up to 50,000 dwt each and two 35,000-dwt ships plus one 10,000-dwt roll-on-roll-off ship. The project scope also involved the acquisition and installation of machinery at the Port of Bata. CCCC First Harbor Engineering Co. Ltd -- a wholly owned subsidiary of China Communications Construction Co. Ltd. — was the contractor responsible for implementation. The project officially commenced on August 6, 2008. However, construction did not begin until February 2009. The project was originally expected to reach completion within 65 months (July 2014). The first ship -- HARJUMAA, a 10,000 dwt container carrier -- was was successfully berthed to the general cargo wharf on November 5, 2012, marking the success of the first trial-berthing at the reconstructed wharf. The project was ultimately completed in December 2014. The expanded port was officially inaugurated on July 30, 2019.